Willie McAteer and Pat Whelan face up to five years in jail for each of the 16 charges of advising and lending millions to a golden circle of investors to falsely inflate Anglo’s share price.
The wife and children of billionaire turned bankrupt Séan Quinn invested, along with a who’s who of Ireland’s property bubble, in an ill-fated bid to save the toxic bank.
It was nationalised within six months of the Jul 2008 scam and has cost the Irish taxpayer about €30bn since — nearly half the country’s total bank bailout.
The two bankers are the first to have been charged with white collar crime linked to a financial collapse which brought the economy to its knees.
A shocked looking Mr McAteer, Anglo’s 61-year-old former finance director from Auburn Villas, Rathgar, south Dublin, was arrested this morning on the N7 at Rathcoole on the outskirts of the city.
His one-time boardroom colleague and alleged co-conspirator, Mr Whelan, 50, Anglo’s former managing director of lending in Ireland, was detained at his home, Rachra, Coast Rd, Malahide, north Dublin.
Both are charged with 16 counts under section 60 of the Companies Act. They are accused of giving unlawful financial assistance in connection with the purchase of Anglo shares in Jul 2008.
Neither of the men, who briefly shared a courthouse cell, spoke when charged, room No 1 in Dublin’s Criminal Courts of Justice was told.
The charges follow three years of intense investigations by the fraud squad and the business watchdog, the Director of the Corporate Enforcement.
Officers have been examining the loans-for-shares scheme, as well as a deposit transfer involving Anglo and the then Irish Life & Permanent, & where about €7bn was moved to mask big customer deposit withdrawals, and a specific loan for a former director.
Sean FitzPatrick, the former chief executive and chairman of Anglo, has been questioned by fraud investigators but no charges have been brought.
The two accused were bailed on a €1,000 bond of their own money and a €10,000 independent surety put up by their respective wives.
Mr McAteer’s wife, Maria, kissed him on the cheek outside the court after bail was secured. The couple and their son left the complex escorted and shielded by members of the fraud squad before being bundled into a taxi.
A tanned Mr Whelan wore a smart grey and navy suit with an open-neck, blue shirt and was accompanied by his wife Sharon for the short hearing at the Dublin District Court.
Anglo, the favoured bank of property speculators and developers, was hit by a stock market collapse in 2008.
Séan Quinn Sr, the 65-year-old former head of a multi-billion-euro conglomerate, lost a fortune secretly trading in the bank’s shares using contracts for difference where he could invest without revealing ownership.
As a result of the collapse he ran up debts of €2.8bn, subsequently lost his business and was declared bankrupt.
The fraud investigation is examining allegations that huge sums of money were given out by the bank to an elite group of customers to invest in Anglo shares in the vain hope of reviving its value.
The group of 16 also included Mr Quinn’s wife, Patricia, their son Séan Jr, who was imprisoned on Friday for contempt of court after allegedly trying to hide €500m of property assets from rebranded Anglo, the Irish Bank Resolution Corporation, and their other children, Colette-Marie, Aoife, Ciara, and Brenda.
The others, nicknamed the Maple 10 by financial investigators from Morgan Stanley called in to look at Anglo’s books, were customers of the bank and big players in property and development.
They were Belfast-born developer Paddy McKillen; Gerry Gannon of Gannon Homes, who had a stake in the K Club Ryder Cup golf resort; Mennolly Homes’ Seamus Ross; auctioneer Brian O’Farrell; John McCabe of McCabe Builders; developer Gerry Maguire; Belfast’s Patrick Kearney; Kildare businessman Jerry Conlan; Sean Reilly of the McGarrell Reilly firm; and developer Joe O’Reilly.
The two accused were bailed to appear before the District Court again on October 8 where books of evidence will be presented and the courts will move towards setting a trial date.
Bail conditions ordered Mr McAteer to hand in his passport and he must give 48 hours’ notice if leaving his address.
Mr Whelan was ordered to reside at his current address and to give 48 hours’ notice if he is travelling anywhere outside Britain, as he regularly travels back and forth to London on business. He was also told to sign on at Malahide Garda Station every Sunday as he awaits trial.
The maximum penalty for the fraud offences is up to five years in jail per offence and a maximum fine of €3,174.